The Australian greenback has began the week with positive aspects. AUD/USD touched a excessive of 0.6850, its highest degree this yr. Within the North American session, the Australian greenback is buying and selling at 0.6842, up 0.51% on the day.
Reserve Financial institution anticipated to carry charges
The Reserve Financial institution of Australia is anticipated to keep up the money fee at 4.35% at Tuesday’s assembly. The RBA has held charges since November, making it an outlier among the many main central banks, most of which have lowered rates of interest. Underlying inflation is at 3.9%, a lot larger than the goal of between 2% and three%. Australia releases August CPI on Wednesday, with headline CPI anticipated to fall to 2.8%, in comparison with 3.5% in July.
The RBA was extra cautious than different central banks in the course of the rate-tightening cycle and its money fee peaked one % under the Federal Reserve. The flip facet is that the RBA has been much less aggressive so far as chopping charges and Governor Bullock has mentioned that there aren’t any plans to chop earlier than February 2025.
The RBA’s fee hikes have chilled financial progress as consumption has fallen sharply and GDP grew by only one% within the second quarter. Nonetheless, the labor market has remained sturdy and unemployment is at 4.2%, as large-scale immigration has boosted the financial system and helped keep away from a recession.
Within the US, as we speak’s PMIs had no impression on AUD/USD. The manufacturing PMI slipped to 47.0 in September, down from 47.9 in August and effectively off the market estimate of 48.5. This was the bottom degree in 13 months as new orders fell sharply. The companies sector is in higher form because the PMI ticked decrease to 54.4, in comparison with 54.6 in August and barely above the market estimate of 54.3.
AUD/USD Technical
- 0.6865 has held in resistance since December 2023. Above, there’s resistance at 0.6923
- 0.6781 and 0.6723 are the subsequent help ranges
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A extremely skilled monetary market analyst with a deal with elementary and macroeconomic evaluation, Kenny Fisher’s every day commentary covers a broad vary of markets together with foreign exchange, equities and commodities. His work has been printed in main on-line monetary publications together with Investing.com, Looking for Alpha and FXStreet. Kenny has been a MarketPulse contributor since 2012.
